Pakistan and coal

Coal reserves
Pakistan's largest coal reserves are found in Sindh with approximately 184,123 million tonnes:

Thar coalfields
The recent discovery of low-ash, low-sulfur lignite coal reserves in the Tharparkar (Thar) Desert in Sindh province has increased both domestic and foreign development interest in using the coal for a local coal-fired plant in Pakistan. President of Pakistan Economy Watch Dr Murtaza Mughal has said there are 185 billion tonnes of coal worth USD $25 trillion In 2007, the Shenhua Group of China withdrew from a $1.5 billion Thar coal project because it considered the power tariff rate inadequate for power generation.

In October 2009, the Sindh government set up a joint venture company — the Sindh Engro Mining Company —on a 40:60 ratio for exploration in Block 2 of the Thar area, done through international competitive bidding. The company planned to develop an open pit mine of 6.5 million tonnes per annum capacity initially which would be scaled up to 22.5 million tonnes per annum subsequently. Power generation would be carried out by Engro Power Gen. Initially, 1,200 megawatts would be generated and it would be raised to 4,000 MW. The first megawatt of electricity from Thar into the national grid was planned for 2015-2016. A licence had also been granted for an experimental project on coal gasification.

In December 2009 the Karachi Electric Supply Company (KESC) signed a Memorandum of Understanding (MoU) with Oracle Coalfields, a company incorporated in England and Wales and primarily engaged in coal drilling, exploration, mining, and production, to set up a major coal-fired power plant fueled by coal to be mined at Thar Coalfields in Sindh. According to the MoU, Oracle Coalfields will own and operate the mine supplying coal to the power plant. A KESC release said the intention of KESC is to be one of the pioneers in tapping indigenous Thar coal reserves for power generation.

The Sindh government in Pakistan signed a $30 million agreement with the World Bank for the Thar Coal and Power Technical Assistance Project (TCAP). However, in May 2010 Pakistani news outlets reported that the World Bank had withdrawn from the project. One anonymous government official stated that "major reasons for the World Bank's withdrawal from the project is lack of emphasis on Thar coal resources in our national energy policy and our failure to highlight these reserves as critical for our national security." One issue reportedly of concern to the World Bank was the resettlement of local people.

In 2011, Sindh Engro Coal Mining Company’s Chief Executive Officer Khalid Mansoor warned that delay in provision of infrastructure like water and transmission lines might jeopardise the $3.4 billion coal project at Thar. The joint venture between the Sindh government and Engro and is scheduled to produce 1,200-MW in the first phase by 2015-16 and 4,000-MW in the second phase by 2020. In a presentation on Thar coal to Prime Minister Syed Yousuf Raza Gilani in Karachi, Mr Mansoor said that lack of grant payment of Rs10 billion by the federal government had created financial difficulties for smooth running of the project. Thar Coal Energy Board Managing Director Ajaz Ali Khan endorsed the views of Mr Mansoor and said that the vital infrastructure projects for Thar coal development was needed by 2015, at an estimated cost of Rs148 billion. Khan requested the prime minister to organise an international conference donors such as the World Bank, the International Finance Corporation and investors from China, USA, UK, Japan and the Middle East for attracting foreign direct investment in Thar coal projects.

On May 14, 2011, Pakistan's Federal Finance Minister Abdul Hafeez Shaikh assured the Thar Coal Energy Board (TCEB) that the federal government would provide "all possible assistance and funding" for infrastructure development for the Thar coalfields. He gave this assurance at a meeting of the TCEB chaired by Sindh Chief Minister Syed Qaim Ali Shah, which gave an update on infrastructure development projects that included a water supply scheme of Makhi-Farash, transmission network, railway link, effluent disposal, etc. The meeting also discussed infrastructure projects that included a water supply scheme for Thar coalfields, a 296-kilometre-long road from Karachi to Islamkot via Thatta, and an airport at Islamkot with an estimated cost of Rs972 million.

According to official sources, the chief minister emphasised that the development of Thar coal was the "central policy agenda of the government" and "indigenous resources could resolve the chronic energy problems of Pakistan for the next 100 years." TCEB, on the basis of recommendations of the committee, allocated coal blocks offered for bidding to various local and international bidding companies based upon the companies' financial strength, mining capabilities and project timelines. The chief minister noted that a fiscal incentives package for indigenous coal-based projects had been approved.

Thar Coal Underground Gasification project
The Thar Coal Underground Gasification (TCUG) project led by nuclear scientist and member Planning Commission Dr. Samar Mubarakmand has been allocated Rs2.5 million by the Ministry of Petroleum and Natural Resources. The estimated total cost of the project is Rs126.649 million, but as of June 2011 has funding of Rs20 million. Under the project, coal would not be mined but rather plants would be installed on deposits to produce gas.

March 2011: 43 killed in explosions
On March 19, 2011, it was reported that at least seven miners were killed and 41 others trapped underground when three explosions triggered a collapse in a coal mine in Pakistan’s Baluchistan province. The miners were working around 1,200 metres underground in the far-flung Sorange district of an insurgency-torn province. Officials said the chances of the missing surviving were slim. The mine was poorly ventilated, allowing poisonous gases to accumulate and, officials believe, causing the three blasts. The coal mine is run by the state-owned Pakistan Mineral Development Corporation. Baluchistan is plagued by an insurgency wanting more jobs and royalties, with hundreds of people dying in the violence since 2004. Most coal mines in the impoverished province are notorious for poor safety standards and facilities, with similar deadly accidents having occurred in the past.

On March 22, 2011, it was reported that 43 were presumed dead, all bodies were recovered. Iftikhar Ahmed, a government mine inspector, said the mine was declared dangerous two weeks prior because of methane gas, but the warning was ignored by the contractor. A total of nine miners were rescued. State officials promised action against those they deemed responsible for ignoring warnings to stop mining due to methane buildup inside the mine shaft.

Related SourceWatch articles

 * Global use and production of coal
 * Australia and coal
 * Britain and coal
 * China and coal
 * Colombia and coal
 * Germany and coal
 * Indonesia and coal
 * Japan and coal
 * New Zealand and coal
 * South Africa and coal
 * United States and coal
 * Coal reserves

External resources

 * International Energy Agency, "Coal in Pakistan in 2006", International Energy Agency website, accessed August 2009.
 * U.S. Geological Survey, "The Mineral Industry of Pakistan", reports 1994-2007.
 * Chin S. Kuo, "The Mineral Industry of Pakistan: 2007, U.S. Department of the Interior, U.S. Geological Survey, April 2009.

External Articles

 * "Thar coal reserves can turn around Pakistani fortunes," Steel Guru, 2/5/09.
 * "Sindh: UAE, Korea to set up 1,000 MW coal power plant", Pakistan Realog, July 22, 2009.
 * "Thar Coal Project", Industry & Economy'', undated, accessed May 2010.